The process of calculating market clearing prices for cap and trade environmental pollution policies dealing with both air and water pollution remains problematic. The permit trading processes are designed to mimic the cost minimisation outcome. In the paper we design the market process for...

This paper examines the construction and implementation of a regional transferable discharge permit system for phosphorus runoff from agricultural-related sources. The impact on behavior at the firm level is also examined. Results indicate that firms may respond to binding environmental...